Today is Labor Day, if you’re in the United States. Pretty much anywhere else in the world, if someone said Labor Day (only they would spell it Labour Day), you’d think of May Day — the International Workers’ Day in the European socialist tradition. It’s celebrated on May 1, in fact, to commemorate an American event: the Haymarket Riots of early May, 1884.

So what’s the story? Why do Latvian workers celebrate labor day on the anniversary of an American riot, while American workers celebrate it five months later? Is this another case of us being quirky, as when we refuse to go over to the Metric system, or have universal health care? (For the record, IMO metric system boo, universal health care possibly yay, although with lots of caveats, a sense that a federal health system would deeply violate subsidiarity, and the expectation of being disappointed in any actual system that gets put in place. So actually probably universal health care boo, also. If you understand that to mean federalized, central health care. New paradigm, anyone?)

Back to Labor Day, though. It was made a national holiday in 1894, though it had been celebrated for couple of decades by various labor unions, and by 30 states. The man most responsible for its federalization was Louis F. Post, at the time an editorial writer for a penny paper, and later the Assistant Secretary of Labor under Wilson.

Post was a disciple of the maverick economist Henry George, and his main goal in promoting the first Monday in September observance was to promote George’s ideas (George’s birthday was September 2). President Cleveland and others who were worried about a socialist revolution loved the idea of a non-May 1 labor day, because in the decade or so since Haymarket, May 1 had become a flashpoint, a temporal focus of social unrest. The immediate occasion for Cleveland signing the legislation making Labor Day a national holiday was, in fact, the May 11 Pullman Strike, which had been timed to coincide more or less with May Day. Cleveland hoped by signing the legislation to centralize and tame labor day. It worked.

The Most Famous Economist You’ve Never Heard Of

Henry George’s life reads a little bit like a parody of Ben Franklin’s. Born in Philadelphia, he was an autodidact, having dropped out of school after seventh grade to run away to sea. He became a printer, and with his printer buddies, set the type himself for his major book,Progress and Poverty.

This book was the primary influence on many of the members of the Fabian Society, the British socialist movement of which George Bernard Shaw was chief proponent, and on the ideas of which, much of the European social democratic order is based. Shaw at one point wrote in a letter to George’s daughter Anna, “Your father found me a literary dilettante and militant rationalist in religion, and a barren rascal at that. By turning my mind to economics he made a man of me….”

Not all of George’s ideas were unorthodox. In summary, H. James Brown wrote:

Like all the classical economists, George believed that competitive markets and private property encouraged efficiency and productivity by systematically rewarding producers for meeting consumers’ needs at the lowest possible cost. He also recognized that land was a very peculiar commodity. No matter how high its price rose, its supply could not increase. Yet the demand for land inevitably rose… and the wealth of landowners tended to grow regardless of how well or badly they used the land.

Worse Than The Disease?

It was George’s solution that was radical. He wanted to regard all land as commons, and to replace income taxes with a single real estate tax, understood as a rent paid to “the community” who were the actual owners of the land. People could stay on the land that they had owned, and the tax would be such that it would make economic sense to do so as long as you were actually farming the land for your own subsistence and perhaps to trade on a limited scale. What would not make economic sense– or be allowed– would be making a living by renting land that you owned to someone else.

An article by Jeffrey J. Smith provides a modern restatement of some of the issues George addressed, and in the 1970s, Agnes George de Mille, the dancer and choreogapher (and niece of the director Cecil B. de Mille) wrote a summary of her grandfather’s beliefs– or at least of what he believed was wrong with the world. She wrote:

We have reached the deplorable circumstance where in large measure a very powerful few are in possession of the earth’s resources, the land and its riches and all the franchises and other privileges that yield a return. These positions are maintained virtually without taxation; they are immune to the demands made on others. The very poor, who have nothing, are the object of compulsory charity. And the rest — the workers, the middle-class, the backbone of the country — are made to support the lot by their labor.

We are taxed at every point of our lives, on everything we earn, on everything we save, on much that we inherit, on much that we buy at every stage of the manufacture and on the final purchase. The taxes are punishing, crippling, demoralizing. Also they are, to a great extent, unnecessary.

I do not wish to be misunderstood as falling into the trap of the socialists and communists who condemn all privately owned business, all factories, all machinery and organizations for producing wealth. There is nothing wrong with private corporations owning the means of producing wealth. Georgists believe in private enterprise, and in its virtues and incentives to produce at maximum efficiency. It is the insidious linking together of special privilege, the unjust outright private ownership of natural or public resources, monopolies, franchises, that produce unfair domination and autocracy.

The means of producing wealth differ at the root: some is thieved from the people and some is honestly earned. George differentiated; Marx did not. The consequences of our failure to discern lie at the heart of our trouble.

She summarizes with stirring words: George’s ideas come down to this: “he who makes should have; he who saves should enjoy; what the community produces belongs to the community for communal uses; and God’s earth, all of it, is the right of the people who inhabit the earth.”

It sounds very good. The vision of small homesteads is appealing, as is the discouragement of absentee landlordism. But any distributist will raise his antennae at the mention of “the community.” In practice, this can mean nothing but ownership of the land by the state, and that is just not the vision of peasant proprietorship that appealed to GK Chesterton and the first distributists. One Georgist site makes this clear:

Some hold that a distinction should be drawn between Common property — that which all have an equal right to use and enjoy — and Government property — that which belongs to the state and is subject to the direction of the government. If we believe, however, as Henry George did, that the purpose of government is to secure equal rights of all people, then there can be no meaningful distinction between common and government property. The government’s role is to administer the common property of the people — who may decide, through the political process, to hold certain areas off the market for public use.

The Distributist Alternative

Chesterton eventually broke with the Fabian Society, and with George’s ideas, to promote instead his and Hilaire Belloc’s alternative program of distributism. He and Shaw spend a good chunk of the rest of their lives debating whether or not Chesterton’s apostasy was justified. The main problem that GKC had with the Fabian/Georgist program was that, as described above, it called for public, not private ownership of land, which would then be leased to those who worked it. This seemed to GKC to be a marginally better idea than private ownership if that meant that a couple of very rich people got to own all the land and everyone else had to be tenants or wage-earners, with no possibility of getting their own homestead. But better still would be a society where private ownership was not just legally protected in the abstract, but actually enjoyed, by as many people as possible. If we’re going to be utopian, GKC seemed to decide, let’s actually try to make a utopia that would be maximally fun to live in.

Public land ownership that prevented the total serfification of laborers might be better than private ownership that ended up looking like debt peonage or sharecropping. But it still wouldn’t exactly promote the kind of family-based homesteading or quirky entrepreneurialism that GKC thought most people in the world probably wanted. If the state (or the community, as a Georgist might say) owns the land your homestead is on, it will be in practice next to impossible for you to maintain a sane, normal relationship with that land. It would be even more difficult than it is now to argue against overregulation of the use of that land. Any homesteader in a Georgist state will, in all probability, sooner or later wake up to a government agent taking the temperature of his compost pile, as Joel Salatin described in this podcast, and telling him that it isn’t getting hot enough.

Preventing people from dumping, say, all their spare arsenic into the stream that runs through their property and from which small children drink on the next farm over is one thing. No sane person would begrudge a law against that. And the idea that some land should be set aside for commons is almost universal in human societies. Gleaning laws and other land-use and land-sale regulations appear in the Bible (sorry, Christian libertarians!) These are all fine, and if thoughtfully employed promote the thriving of families, people, and communities. But the kind of regulation that you’d get in a fully Georgist state is an entirely different kettle of fish. He was right in his diagnosis of much of what was wrong with the world. Where he went wrong was in his prescription of how to make it right.